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Taxation (Kiwisaver, Student Loans, and Remedial Matters) Bill (Consistent) (Section 14) [2019] NZBORARp 28 (11 June 2019)
Last Updated: 27 July 2019
11 June 2019
LEGAL ADVICE
LPA 01 01 24
Hon David Parker, Attorney-General
Consistency with the New Zealand Bill of Rights Act 1990: Taxation (Kiwisaver,
Student Loans, and Remedial Matters) Bill
Purpose
- We
have considered whether the Taxation (Kiwisaver, Student Loans, and Remedial
Matters) 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 not yet received a final version of the Bill. This advice has been prepared
in relation to the latest version of the Bill
(PCO 21910/1.30). We will provide
you with further advice if the final version includes amendments that affect the
conclusions in
this advice.
- 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 14 (freedom of expression).
Our analysis is set out below.
The Bill
- The
Bill amends the KiwiSaver Act 2006, Student Loan Scheme Act 2011, Income Tax Act
2007, Income Tax Act 2004, Income Tax Act 1994,
Income Tax Act 1976, Tax
Administration Act 1994, Taxation (Annual Rates for 2018-19, Modernising Tax
Administration, and Remedial
Matters) Act 2019, Taxation (Annual Rates for
2017-18, Employment and Investment Income, and Remedial Matters) Act 2018,
Taxation
(Research and Development Tax Credits) Act 2019, and the Income Tax
(Adverse Event Income Equalisation Scheme Rate of Interest) Regulations
1995.
- The
overall aim of the proposals is to simplify and modernise the administration of
Student Loans and KiwiSaver, improve current tax
settings within a broad-base,
low-rate framework, and extend the refundability of research and development tax
credits to support
government objectives relating to increasing firm expenditure
on research and development.
Consistency of the Bill with the Bill of Rights Act
Section 14 – Freedom of Expression
- Section
14 of the Bill of Rights Act affirms the right to freedom of expression. This
includes the freedom to seek, receive, and impart
information and opinions of
any kind and in any form. The right has been interpreted as including the right
not to be compelled to
say certain things or to provide certain
information.1
1 RJR MacDonald v Attorney-General of
Canada (1995) 127 DLR (4th).
- There
are several provisions in the Bill that compel the provision of specific
information, including:
- clause
13, which requires employers to provide the Commissioner with information about
its employees’ gross salary or wages
for employees participating in
KiwiSaver, and
- clause
25, which requires that employers provide the Commissioner with information
about the rate of superannuation contribution tax
it applied to an
employee’s KiwiSaver contribution.
- Where
a provision is found to limit a particular right or freedom, it may nevertheless
be consistent with the Bill of Rights Act if
it can be considered a reasonable
limit that is justifiable in terms of s 5 of that Act. The s 5 inquiry may be
approached as follows:
- Does
the provision serve an objective sufficiently important to justify some
limitation of the right or freedom?
- If
so, then:
- is
the limit rationally connected with the objective?
- does
the limit impair the right or freedom no more than is reasonably necessary for
sufficient achievement of the objective?
- is
the limit in due proportion to the importance of the objective?
2
- We
consider that the objectives of the Bill are sufficiently important to justify
some limitation on the right to freedom of expression,
and that the limit
proposed by cls 13 and 25 are rationally connected to the Bill’s
objectives. Clauses 13 and 25 of the Bill
enable the Inland Revenue Department
to efficiently calculate and collect the correct amount of tax owed by
employees.
- In
particular, the information collected at cl 13 allows the Inland Revenue
Department to pay out KiwiSaver contributions before they
are received from the
employer, meaning that members receive the benefit of their contributions being
invested sooner. The information
collected at cl 25 supports the Inland Revenue
Department to more easily verify that the correct tax rate has been applied by
employers
and reduces the likelihood that employers are subject to penalties in
the case of any miscalculation.
- We
consider that the limits are no more than is reasonably necessary for, and
proportionate to, the achievement of the Bill’s
objectives. The Bill only
collects information necessary for achieving the objectives, and this
information is of a type that is
consistent overall with the many other
provisions in taxation legislation requiring employers to provide information to
the Commissioner.
2 Hansen v R [2007] NZSC 7
[123].
- For
these reasons, we conclude that any limits to the freedom of expression imposed
by the Bill are justified under s 5 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
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