WELLINGTON, Dec. 5 (Xinhua) -- New tax legislation has been introduced to Parliament to ensure greater fairness in the way the tax system shapes commerce, investment decisions and social policies, New Zealand's Revenue Minister Stuart Nash said on Wednesday.
The bill implements two major policies, which went through public consultation earlier this year, as well as picking up on smaller issues, which have been the source of some frustration and complaint for those who deal with the revenue system, Nash said while introducing the Taxation Bill, which is expected to have its first reading next Wednesday.
The legislation establishes a framework to collect goods and services tax (GST) on low-value imported goods, Nash said, adding the changes put local retailers on a level playing field with foreign firms who have taken advantage of the tax break.
There are 26,000 small businesses in New Zealand's retail sector, employing more than 62,000 people. They are required to collect GST on all sales, and now the same requirement will apply to offshore retail giants, the minister said.
The new GST collection system applies to imported goods valued under 1,000 NZ dollars (691 U.S. dollars) and will come into effect on Oct. 1, 2019. GST on goods valued above 1,000 NZ dollars will continue to be collected by Customs when the goods enter New Zealand, Nash said.
"The internet has opened up more markets for global companies but if they want to do business here, they must follow the rules like everyone else. We're not the first to introduce such a rule and eventually this will be the new reality of doing business," he said.
The second major change will mean residential property investors no longer get a tax break by using losses on rental properties to offset the tax payable on other sources of income such as salary and wages, according to the minister.
The legislation recognizes the growing use of Maori language as an everyday language, including by many businesses, he said, adding the right to use Maori should be officially recognized in the law, rather than at the discretion of a government department.