[Sitting date: 31 May 2012. Volume:680;Page:2758. Text is incorporated into the Bound Volume.]
Dr DAVID CLARK (Labour—Dunedin North) to the
Minister of Finance: Does he stand by his statement regarding changes to the child tax credit that “if it’s interest on their savings or other means of payment they won’t pay any tax”?
Hon PETER DUNNE (Minister of Revenue) on behalf of the
Minister of Finance: That answer to a media question was not accurate, because it did not take account of the resident withholding tax, introduced way back in 1989 under Labour, which is applied to every dollar of interest or dividends.
Dr David Clark: Did the revenue Minister take the proposal for the child tax policy to Cabinet or any other Cabinet committee; and, if so, were he and the Prime Minister present at those meetings?
Hon PETER DUNNE: I can certainly answer for the revenue Minister yes to the first part of the question. To the second part of the question, my recollection is that the Prime Minister was certainly present at the meeting, which he alluded to himself last Monday week, but I cannot be more specific than that.
Dr David Clark: Was the Prime Minister correct in his answer to question No. 12 yesterday that the changes to the child tax credit “would remove the tax status for those who earn $2,340 from PAYE income.”?
Hon PETER DUNNE: The Prime Minister was correct in his answer yesterday. What we are doing is introducing an active income exemption for those who qualify, so that is persons under the age of 18, part-time workers, and children earning less than $2,340 per annum.
Dr David Clark: Has he seen recent Treasury figures that show his 2010 income tax cuts cost somewhere between $11 billion and $12 billion over the forecast period; and, if so, how much of that will be recovered by the paper delivery tax?
Hon PETER DUNNE: I think it is important to appreciate that the change the member refers to, plus the other two tax credit removals, was about streamlining and improving the tax system. Those changes, together with the changes announced to livestock and the mixed use of assets, will make a significant contribution to the Government’s revenue.
Hon Member: How much?
Hon PETER DUNNE: Some several hundred million dollars over the forecast period.