The Māori Council has welcomed the government’s desire to review the tax system but urged them to make the shift from pure accounting principles to human ones.
Speaking at a forum on Māori Business, Council Executive Director Matthew Tukaki says Māori, Māori organisations and iwi need to look at the recommendations through a Māori lens.
“The capital gains tax discussion at the moment is both premature and ill informed. It’s not an easy tax to introduce or administer and is probably some way off if at all. In the Australian experience the number of exemptions has grown over the years and nowhere in the debate has that number been discussed.
“For Māori, however, we need to see it in the context of what it might impact in terms of future Treaty settlements that could include assets like buildings and infrastructure. Does that cause an exemption?” says Tukaki.
“The other thing we need to be mindful of is the debate around Māori economic development – as we push to develop up Māori land that will create a capital value and therefore at sale the difference between cost and profit may be taxable – should it be and will it be?”
Tukaki asserts that some areas have been missed in the reform discussion.
“For example, I would have liked to have seen tax relief for families who are currently fostering or caring for children out [of] state care. By tax relief I also mean additional deductions from school clothing and uniforms to stationary and so on. A lot of these families take on the task of looking after very vulnerable children with no or little financial support. Tax relief could be one way of recognising what they do including maybe a slight exemption on the personal income tax,” says Tukaki.
“A number of Māori operate in the small business world – in fact small business is the backbone to the New Zealand economy. It would have been good to see investment incentives such as instant asset write offs to allow for new equipment and capital purchases to be instantly written off. This gives small business access to more working capital more readily and therefore could encourage them to employ more New Zealanders.”
“I think also we have lost the opportunity to look at tax relief or creative ways of supporting primary industries to transition into a lower carbon future and we sure have missed the boat when it comes to Māori and the growing calls for a tax on water.”
Tukaki laments the need for more Māori to come into the financial services sector and grow both the skills and knowledge base.
“We are part of a much larger global economy but as Māori, we are part and parcel of hundreds of smaller micro-economies around the world. What we need to do is look at building our financial knowledge and wealth base, our skills and workforce to manage our own investment and financial futures.”