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Taxation (Budget Measures: Family Incomes Package) Bill (Consistent) (Section 19(1)) [2017] NZBORARp 23 (10 May 2017)
Last Updated: 6 January 2019
10 May 2017
Hon Christopher Finlayson QC, Attorney-General
LEGAL ADVICE
LPA 01 01 21
Consistency with the New Zealand Bill of Rights Act 1990: Taxation (Budget
Measures: Family Incomes Package) Bill
Purpose
- We
have considered whether the Taxation (Budget Measures: Family Incomes Package)
Bill (‘the Bill’) is consistent with
the rights and freedoms
affirmed in the New Zealand Bill of Rights Act 1990 (‘the Bill of Rights
Act’).
- We
have concluded that the Bill appears to be consistent with the rights and
freedoms affirmed in the Bill of Rights Act. In reaching
that conclusion, we
have considered the consistency of the Bill with s 19(1) (freedom from
discrimination). Our analysis is set
out below.
The Bill
- The
purpose of the Bill is to give effect to tax and tax credit reforms to be
announced in Budget 2017. To this end, the Bill amends
the:
- Income
Tax Act 2007
- Tax
Administration Act 1994
- Taxation
(Annual Rates and Budget Measures) Act 2011, and
- Customs
and Excise (Tobacco Products – Budget Measures) Amendment Act
2016.
- The
amendments include increasing the two lowest personal income tax thresholds,
repealing the Independent Earner Tax Credit, and
increasing the younger child
payment rates of the Family Tax Credit. The changes are intended to provide
better rewards for hard
work, improve incomes for those with young children or
high housing costs, and simplify the tax and transfer
system.
Consistency of the Bill with the Bill of Rights Act
Section 19(1) – Freedom from discrimination
- Section
19(1) of the Bill of Rights Act affirms the right to be free from discrimination
on the prohibited grounds set out in the
Human Rights Act 1993 (‘the Human
Rights Act’).
- The
key questions determining whether legislation limits the freedom from
discrimination are:1
- does
the legislation draw a distinction on one of the prohibited grounds of
discrimination under the Human Rights Act?
- if
so, does the distinction involve material disadvantage to one or more classes of
individuals?
- A
distinction will arise if the legislation treats two comparable groups of people
differently on one or more of the prohibited grounds
of discrimination. Whether
disadvantage arises is a factual determination.2
- Taxation
legislation necessarily draws distinctions based on a number of factors,
including on the prohibited grounds of discrimination
in s 21 of the Human
Rights Act. For example, such distinctions might include marital status, family
status, age, and employment
status. It is not clear, however, that any such
distinctions in the Bill would result in material disadvantage for any class or
classes
of person, as any disadvantage appears to be minimal. For the purposes
of this advice, we assume that some material disadvantage
could arise.
- To
the extent the Bill may give rise to discrimination, however, we consider that
any such limits are demonstrably justified under
s 5 of the Bill of Rights
Act.
- The
objective of the Bill is sufficiently important to justify some limit on s 19(1)
and any limits appear rationally and proportionately
connected to that
objective. Parliament is entitled to appropriate latitude to achieve its
objectives.3 Achieving a fair and efficient tax system
is a complex social policy matter and there can be ‘many ways to approach
a particular
problem, and no certainty as to which will be the most
effective.’4 Having established basic tax rates
and tax credits, it is a matter of legitimate policy choice as to where the
thresholds are drawn.
- We
therefore consider the Bill appears to be consistent with the right to be free
from discrimination affirmed in s 19(1) of the Bill
of Rights
Act.
Conclusion
We have concluded that the Bill appears to be
consistent with the rights and freedoms affirmed in the Bill of Rights Act.
Jeff Orr
Chief Legal Counsel Office of Legal Counsel
1 See, for example,
Atkinson v Minister of Health and others [2010] NZHRRT 1; McAlister v
Air New Zealand [2009] NZSC 78; and Child Poverty Action Group v
Attorney-General [2008] NZHRRT 31.
2 See, for example, Child Poverty Action Group v
Attorney-General above n 2 at [179]; and McAlister v Air New
Zealand
above n 2 at [40] per Elias CJ, Blanchard and Wilson JJ.
3 Hansen at [126] per Tipping J.
4 Canada (A-G) v JTI-McDonald Corp [2007] 2
SCR 610 at [43].
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